A Houston man found asleep with a corpse inside a closet of a vacant home has been charged with misdemeanor drug offenses, authorities said Monday. Cody Jean Plant, 21, was discovered Sunday after the owner of the house reported hearing voices and seeing signs of forced entry at the home in Cypress, about 25 miles northwest of Houston, according to a Harris County Precinct 4 Constable official. Authorities did not immediately release the dead man's identity.
"There were two guys in the closet. They appeared to be sleeping, one was snoring and the other was deceased," said Assistant Chief Deputy Mark Herman. "It appeared that they were doing some sort of narcotics, at least the one that they woke up."
Plant was charged with one count of possession of a dangerous drug and two counts of possession of a controlled substance of more than three grams and less than 28 grams. All are punishable by up to a year in jail. It was not immediately clear what kind of drugs Plant allegedly had in his possession.
Plant also had been charged with abuse of a corpse after prosecutors alleged he treated the body "in an offensive manner," but that charge was dropped Monday during a probable cause hearing.
Plant remained in the Harris County Jail in lieu of $15,000 bail Monday. Jail officials did not know Monday night whether Plant had an attorney.
Tuesday, October 13, 2009
A big hunk o' hair -- Elvis locks go under the hammer
Elvis Presley fans keen to own a chunk of their idol now can: locks of what is claimed to be The King's hair are up for auction next week.
The large quantity of hair is one of about 200 items of Elvis memorabilia collected by the late Gary Pepper, who was the president of the Tankers Fan Club set up for Elvis fans.
Chicago-based Leslie Hindman Auctioneers said the hair, which is expected to sell for between $8,000 and $12,000 at the October 18 auction, was given to Pepper to mail to Presley fans and was believed to be from when the singer had his hair cut to join the U.S. Army.
"In 1958, the nation's newspapers announced that Elvis Presley, having been newly recruited into the U.S. Army, had received two haircuts trimming his famous locks and sideburns down to a greatly modified crew cut," said a statement by the auction house.
"Individual strands of Elvis Presley's shaved locks have since been treasured by his fans who wish to own a piece of The King himself."
The auction house has not had a DNA test carried out on the hair but quoted "an expert in celebrity hair authentication," John Reznikoff, saying it matched the Elvis hair he has in his collection.
Presley died in 1977 at the age of 42.
Other items up for sale include signed photos, albums, publicity shots, souvenirs, and clothing.
The large quantity of hair is one of about 200 items of Elvis memorabilia collected by the late Gary Pepper, who was the president of the Tankers Fan Club set up for Elvis fans.
Chicago-based Leslie Hindman Auctioneers said the hair, which is expected to sell for between $8,000 and $12,000 at the October 18 auction, was given to Pepper to mail to Presley fans and was believed to be from when the singer had his hair cut to join the U.S. Army.
"In 1958, the nation's newspapers announced that Elvis Presley, having been newly recruited into the U.S. Army, had received two haircuts trimming his famous locks and sideburns down to a greatly modified crew cut," said a statement by the auction house.
"Individual strands of Elvis Presley's shaved locks have since been treasured by his fans who wish to own a piece of The King himself."
The auction house has not had a DNA test carried out on the hair but quoted "an expert in celebrity hair authentication," John Reznikoff, saying it matched the Elvis hair he has in his collection.
Presley died in 1977 at the age of 42.
Other items up for sale include signed photos, albums, publicity shots, souvenirs, and clothing.
Wednesday, April 1, 2009
The Mystery of the Declaration of Independence
This story started in June 2004, when Artemy Lebedev was engaged in researching some documents in the sheet materials section of the Central State Archive of Foreign History of Ukraine based in Kiev. Much agitated Nikolay Kislenko, the head of the archive, approached him and said, “Now come, there’s something I want to show you. You’ve never seen anything like it.”
On one of the storage shelves in the vaults lay a thick lincrusta-bound folder with Nor[th] Am[erica]. [War 17]75–83 written on it in correction fluid. Among the letters, etchings, a variety of billboards and fly-sheets lay a moldering sheet folded three times—the U.S. Declaration of Independence of 1776.
The text of the Declaration was adopted on July 4, 1776 and signed by two officials: John Hancock, President of the Continental Congress, and Charles Thomson, Secretary. On the same date the printer John Dunlap printed the endorsed document (of which there are 24 copies left as of today) that were dispatched to different assemblies, conventions, and committees of safety the next day.
The handlettering of the engrossed Declaration of Independence as it is known today began on July 19, and it was physically signed by the representatives of the Continental Congress on August 2, 1776.
The questions that still remained unresolved were how one of the pillars of the US national pride happened to wind up in the Kiev archives, and why the document of historical importance was entitled “United States of Жmerinca” (russian letter “Ж” corresponds to "Zh").
On July 19, Congress ordered that the Declaration be “fairly engrossed on parchment with the title and stile (sic!) of ‘The Unanimous Declaration of the thirteen United States of America’ and that the same, when engrossed, be signed by every member of Congress.”
Timothy Matlack, Assistant to Charles Thomson, was assigned with engrossing the document. At this point the tone of the official records of the Declaration history shifts, and the rest of the data is provided in an extremely piecemeal manner. It is only known that the delegates of Congress affixed their signatures to the Declaration on August 2.
After that an obscure period in the life of the 24¼ × 29¾ inch sheet of paper sets in. The Declaration was rolled and stashed away in an archive. Throughout this time, the document is never exhibited in public: instead, a fly-sheet with its text is distributed. In the meantime, the original document travels from one archive to another, until its arrival in Washington in 1814.
The fact is the real name of Timothy Matlack who penned the Declaration of Independence is Tomislav Matlakowski. Several years before the revolutionary events began to unfold in the New World, he left the voivodship of Bratslav and sailed for America, where he at first worked as a brewer, then took some interest in the Quaker movement and finally went for politics. Sometimes he was given calligraphic work: he penned some landmark official documents, including George Washington’s commission as commanding general of the Continental Army.
According to the State Archive of the Ukraine Health Ministry, Matlakowski was born in the place named Zhmerinca (a city since 1903).
In all likelihood, the nostalgic Matlakowski wrote the title in mixed alphabets, while Congress members didn’t notice anything wrong on the day when the Declaration was signed. But it was apparently discovered the next day by Charles Thomson, the discovery leading him to order immediately that the original be hidden from the public eye, and Matlack be demoted from the Secretary of the Commonwealth of Pennsylvania to the Congress Delegate from the same state.
There were two attempts to make a facsimile of the Declaration: in 1818 and 1819. But these facsimile printings were declared unsuitable for public display, since the copyists commissioned to produce the facsimiles decorated the document with ornamental designs and patterns. But Congress needed to have an exact copy that would be exhibited for public display. So William J. Stone was commissioned to do the job in 1820. It took Stone three years to complete the facsimile, and the Department of State purchased the plate from the engraver.
On June 5, 1823 the (Washington) National Intelligencer observed: “The facility of multiplying copies of it, now possessed by the Department of State will render furthur (sic!) exposure of the original unnecessary.”
The outcome of the engraver’s painstaking work was the image that’s printed on posters and sold these days.
Stone failed to solve two problems: the one with the letter “Ж” and the one with the dissymmetry of the heading against the text body.
Under the canons of the time, the heading was supposed to be as broad as the text body, or centered, but a special Congress commission decided that the error was insignificant. Stone convinced the commission members that the unknowing public would have no doubt that what they see is the letter “A”.
Ever since the original document hasn’t been shown to anyone and the data on its destiny has been missing. An aged copy that’s exposed under a bulletproof glass among the three Charters of Freedom in the National Archives Rotunda in Washington was placed on display in the middle of the 19th century.
The story of the film “National Treasure” starring Nicolas Cage hinges on this copy. A curious thing is that the film producers saw to it that the heading is never shot in a close-up, while all posters were made as collages where the letter “Ж” is concealed one way or another.
[Via Artlebedev.com]
On one of the storage shelves in the vaults lay a thick lincrusta-bound folder with Nor[th] Am[erica]. [War 17]75–83 written on it in correction fluid. Among the letters, etchings, a variety of billboards and fly-sheets lay a moldering sheet folded three times—the U.S. Declaration of Independence of 1776.
The text of the Declaration was adopted on July 4, 1776 and signed by two officials: John Hancock, President of the Continental Congress, and Charles Thomson, Secretary. On the same date the printer John Dunlap printed the endorsed document (of which there are 24 copies left as of today) that were dispatched to different assemblies, conventions, and committees of safety the next day.
The handlettering of the engrossed Declaration of Independence as it is known today began on July 19, and it was physically signed by the representatives of the Continental Congress on August 2, 1776.
The questions that still remained unresolved were how one of the pillars of the US national pride happened to wind up in the Kiev archives, and why the document of historical importance was entitled “United States of Жmerinca” (russian letter “Ж” corresponds to "Zh").
On July 19, Congress ordered that the Declaration be “fairly engrossed on parchment with the title and stile (sic!) of ‘The Unanimous Declaration of the thirteen United States of America’ and that the same, when engrossed, be signed by every member of Congress.”
Timothy Matlack, Assistant to Charles Thomson, was assigned with engrossing the document. At this point the tone of the official records of the Declaration history shifts, and the rest of the data is provided in an extremely piecemeal manner. It is only known that the delegates of Congress affixed their signatures to the Declaration on August 2.
After that an obscure period in the life of the 24¼ × 29¾ inch sheet of paper sets in. The Declaration was rolled and stashed away in an archive. Throughout this time, the document is never exhibited in public: instead, a fly-sheet with its text is distributed. In the meantime, the original document travels from one archive to another, until its arrival in Washington in 1814.
The fact is the real name of Timothy Matlack who penned the Declaration of Independence is Tomislav Matlakowski. Several years before the revolutionary events began to unfold in the New World, he left the voivodship of Bratslav and sailed for America, where he at first worked as a brewer, then took some interest in the Quaker movement and finally went for politics. Sometimes he was given calligraphic work: he penned some landmark official documents, including George Washington’s commission as commanding general of the Continental Army.
According to the State Archive of the Ukraine Health Ministry, Matlakowski was born in the place named Zhmerinca (a city since 1903).
In all likelihood, the nostalgic Matlakowski wrote the title in mixed alphabets, while Congress members didn’t notice anything wrong on the day when the Declaration was signed. But it was apparently discovered the next day by Charles Thomson, the discovery leading him to order immediately that the original be hidden from the public eye, and Matlack be demoted from the Secretary of the Commonwealth of Pennsylvania to the Congress Delegate from the same state.
There were two attempts to make a facsimile of the Declaration: in 1818 and 1819. But these facsimile printings were declared unsuitable for public display, since the copyists commissioned to produce the facsimiles decorated the document with ornamental designs and patterns. But Congress needed to have an exact copy that would be exhibited for public display. So William J. Stone was commissioned to do the job in 1820. It took Stone three years to complete the facsimile, and the Department of State purchased the plate from the engraver.
On June 5, 1823 the (Washington) National Intelligencer observed: “The facility of multiplying copies of it, now possessed by the Department of State will render furthur (sic!) exposure of the original unnecessary.”
The outcome of the engraver’s painstaking work was the image that’s printed on posters and sold these days.
Stone failed to solve two problems: the one with the letter “Ж” and the one with the dissymmetry of the heading against the text body.
Under the canons of the time, the heading was supposed to be as broad as the text body, or centered, but a special Congress commission decided that the error was insignificant. Stone convinced the commission members that the unknowing public would have no doubt that what they see is the letter “A”.
Ever since the original document hasn’t been shown to anyone and the data on its destiny has been missing. An aged copy that’s exposed under a bulletproof glass among the three Charters of Freedom in the National Archives Rotunda in Washington was placed on display in the middle of the 19th century.
The story of the film “National Treasure” starring Nicolas Cage hinges on this copy. A curious thing is that the film producers saw to it that the heading is never shot in a close-up, while all posters were made as collages where the letter “Ж” is concealed one way or another.
[Via Artlebedev.com]
Saturday, October 25, 2008
Playboy's Bare Market
Investors looking for a boom should first check out Playboy's busts.
The company, whose stock is trading at a five-year-low of less than $2 a share, announced last week that it's closing its DVD business. Late last month, it was reported by the British tabloid The Daily Star that Playboy founder Hugh Hefner is laying off some of his bunnies because of the souring economy.
And more trouble may await the Playboy empire and its shareholders. According to a study published last week by econometricians Terry Pettijohn II and Brian Jungeberg, men tend to look for bigger, more robust, women during a lean economy. The report -- titled Playboy Playmate Curves: Changes in Facial and Body Feature Preferences Across Social and Economic Conditions -- also noted that when times are prosperous, men prefer less grown-up, shorter women with narrower waists.
In a move that has rendered quaint the once risqué miniskirt index, the pair of academics achieved this breakthrough by comparing the measurements from 40 years of Playmates to the economic data of the times.
"When social and economic conditions were difficult, older, heavier, taller Playboy Playmates of the Year with larger waists, smaller eyes, larger waist-to-hip ratios, smaller bust-to-waist ratios, and smaller body mass index values were selected," says the study. "These results suggest that environmental security may influence perceptions and preferences for women with certain body and facial features."
Boiled down to plain English, the paper posits that men are less interested in viewing women purely for sex when the chips are down, preferring to focus on more mature women with the ability to care for them. In short, Playboy's sales may be headed for an even steeper decline.
Whether the good professors are onto something big is debatable. But Playboy's shareholders should heed the good professors' sage barometer as a centerfold for sell.
[Via The Street]
The company, whose stock is trading at a five-year-low of less than $2 a share, announced last week that it's closing its DVD business. Late last month, it was reported by the British tabloid The Daily Star that Playboy founder Hugh Hefner is laying off some of his bunnies because of the souring economy.
And more trouble may await the Playboy empire and its shareholders. According to a study published last week by econometricians Terry Pettijohn II and Brian Jungeberg, men tend to look for bigger, more robust, women during a lean economy. The report -- titled Playboy Playmate Curves: Changes in Facial and Body Feature Preferences Across Social and Economic Conditions -- also noted that when times are prosperous, men prefer less grown-up, shorter women with narrower waists.
In a move that has rendered quaint the once risqué miniskirt index, the pair of academics achieved this breakthrough by comparing the measurements from 40 years of Playmates to the economic data of the times.
"When social and economic conditions were difficult, older, heavier, taller Playboy Playmates of the Year with larger waists, smaller eyes, larger waist-to-hip ratios, smaller bust-to-waist ratios, and smaller body mass index values were selected," says the study. "These results suggest that environmental security may influence perceptions and preferences for women with certain body and facial features."
Boiled down to plain English, the paper posits that men are less interested in viewing women purely for sex when the chips are down, preferring to focus on more mature women with the ability to care for them. In short, Playboy's sales may be headed for an even steeper decline.
Whether the good professors are onto something big is debatable. But Playboy's shareholders should heed the good professors' sage barometer as a centerfold for sell.
[Via The Street]
Economy Rocks China Factories
SHAOXING, China — In the good old days — oh, three months ago — Tao Shoulong would prowl the streets of this ancient city in his Mercedes-Benz. His wife and partner, Yan Qi, would cruise around in her Toyota Land Cruiser. Together, they would drink into the night with clients, suppliers and creditors, hatching plans to expand their Zhejiang River Dragon Textile Printing & Dyeing Co.
Tao built River Dragon from a start-up with four employees into one of China's biggest textile printing firms in just five years. He had even grander dreams: He wanted to see his company's stock trade on Nasdaq alongside the likes of Microsoft and Intel.
The dreams are dead. River Dragon shut down on Oct. 7. Tao and Yan have vanished, leaving behind more than $290 million in debt and a lot of anger in this city 140 miles south of Shanghai in the Yangtze River Delta. The company's demise put 4,000 workers on the street and jilted hundreds of suppliers and creditors.
The speedy rise — and speedier fall — of River Dragon is a depressingly familiar story in China these days. Thousands of Chinese factories have shuttered in the past year, done in by:
•An export-killing global slowdown that began with the collapse of the U.S. housing market and the ensuing financial crisis. Local textile merchant Fang Xingquan, a River Dragon creditor, is among many who believe a sharp drop-off in exports was a key factor in the company's demise.
•Rising materials costs that have squeezed profit margins.
•A deliberate Chinese government campaign to regulate sweatshop factories out of business.
China's National Bureau of Statistics this week said the nation's economy grew at an annual rate of 9% in the quarter ended Sept. 30, the lowest since 2003. The state-run Xinhua news agency said the government is considering a series of actions to boost exports and stimulate home sales.
Many economists, including Yu Yongding of the Chinese Academy of Social Sciences, believe that China needs to keep annual economic growth of 8% or 9% to absorb the 24 million people entering the labor force every year or risk social instability.
Earlier this month, the International Monetary Fund predicted that Chinese economic growth would cool from 2007's sizzling 11.9% to 9.7% this year and 9.3% in 2009. Private forecasters are even more pessimistic. UBS Investment Research, for instance, forecasts 8% growth in 2009.
"China is being hit over the head by both the global crisis and the domestic slowdown," says Stephen Green, economist at Standard Chartered Bank in Shanghai.
Exports account for nearly 38% of China's economic output. JPMorgan Chase calculates that Chinese exports fall 5.7 percentage points every time global economic growth shrinks by a percentage point. And the IMF is predicting that global growth will drop 2 percentage points — from 5% last year to 3% in 2009. Chinese appliance maker Haier has already seen export growth drop to 10% the first three quarters of this year from 30% a year earlier, the official English-language China Daily newspaper reported.
What happens to China has big implications globally: China contributed 17% of world economic growth last year, the same as the United States, according to the United Nations.
Home prices collapsing
The Chinese economy is absorbing another blow beyond crumbling exports: collapsing home prices. Nicholas Lardy, senior fellow at the Peterson Institute for International Economics in Washington, D.C., reckons a slowdown in construction could shave another 1 to 2 percentage points off China's economic growth.
"The property bubble is already starting to burst," says Yan Yu, a business management scholar at Peking University, researching the export center of Dongguan in southern Guangdong province. "House prices here in Dongguan have fallen by up to 50% this year," leaving many homeowners owing more on their mortgages than their homes are worth.
"People have worked all their lives and believed the hype and bought overvalued properties, then saw their savings vanish," says independent economist Andy Xie in Shanghai. "That carries more political risk" than rising joblessness.
The good news: The forecast growth rates are still pretty impressive by any other economy's standards; Chinese exports have proved surprisingly resilient, growing nearly 22% in September from a year earlier; and the government in Beijing is sitting on enough cash — $1.8 trillion in foreign exchange reserves — to go on a spending spree if needed to rescue the Chinese economy from catastrophe.
"Chinese authorities appear to be well aware of the global economic situation," JPMorgan Chase reported this month. The bank expects government to turn the spigot on spending, quadrupling the budget deficit to the equivalent of 2% of economic output from 0.5% this year.
The authorities aren't going to save everyone. The Chinese government has put pressure on small firms that foul the environment, pay miserly wages and turn out cheap products. "Beijing no longer wants to be the world's sweatshop for junk," CLSA Asia-Pacific Markets says in a recent report.
First, China cut tax breaks for exporters and imposed new export taxes on polluters, even targeting producers of disposable chopsticks. Then it introduced a labor law in January, requiring companies to give workers written contracts and making it harder for them to lay off employees or to hire informal part-time help.
The combination of tougher regulations, weakening exports, rising costs and a stronger Chinese currency has hammered thousands of small factories. The pain has been especially agonizing in Guangdong, a low-cost manufacturing center across the border from Hong Kong in southern China.
Guangdong's exports rose just 14% the first seven months of 2008 after growing 27% a year earlier. Industrial profits were up just 4% this year through May, compared with 49% a year earlier and puny compared with 21% growth nationwide. "Guangdong's weak performance is a signal of the government's determination to restructure the low-value-added export process sector and to force out of business firms that abuse labor and the environment," CLSA concluded.
Trouble in toyland
Firms that were already struggling with narrow profit margins have been squeezed. More than half of all China's toy exporters — 3,631 firms — shut their doors the first half of the year, the official Xinhua news agency reported. "Many toy factories have gone bankrupt this year," says Luo Yunzhang, founder of toy exporter Guangzhou Sixiren Toy, which makes playground equipment for Ohio-based Little Tikes, among other products.
"We saw exports start to dip in May, when the government began restricting businessmen's visits ahead of the (August) Olympic Games. … Now the global crisis is causing problems. When people are in difficulties, they spend less on things like toys," Luo says. Luo predicts that Sixiren's export revenue will drop by half this year, to $500,000.
China's textile industry is also enduring a deep slump. Textile exports have been tumbling since March. More than 10,000 small textile manufacturers went out of business the first half of this year alone, the government says. "The global crisis is seriously affecting the local textile industry," says Yu Xin of the China Chemical Fibers and Textile Consultancy in Hangzhou.
China's 30-year economic boom has produced towns that specialize in one product. There are shoe towns, zipper towns, air conditioner towns and sock towns. Shaoxing — a city of 4.3 million long known in China for opera, rice wine and scenic river vistas — has sold itself as China's Textile City.
The textile sector has been "an easy market, as it is not complicated, has low entry barriers and is a big employer," says Standard Chartered's Green. The local government gives tax breaks, and the industry has benefited from having a large number of suppliers and trained workers close by.
For a while, River Dragon looked like one of the winners. After working as a clerk at another firm, Tao started the company in 2003 with his wife, Yan, and four colleagues. River Dragon went public in Singapore two years ago, and Tao bought another textile firm last year, hoping the acquisition would give River Dragon the heft to list on Nasdaq. In July, Yan, the company CEO, announced that River Dragon had landed a $10 million contract to supply apparel to 76 U.S. universities. But the deal proved a mirage. The end came quickly. A day after the factory stopped production, River Dragon stock was dropped from the Singapore exchange. Corporate documents are missing, and Tao and Yan are long gone.
"I think they are still on the run in China," says Fang, the supplier. He says he was stiffed for more than $860,000 when River Dragon went under.
Keeping society 'stable'
About 300 suppliers and creditors descended on the River Dragon complex, looting warehouses in the hopes of salvaging something. Hundreds of workers demonstrated in the streets, demanding back pay for August and September. Worried about the unrest, the local government coughed up cash. "The government paid the workers to keep society stable," textile analyst Yu says.
As their export orders dry up, Chinese manufacturers are likely to look for customers at home in China or in other emerging markets such as the Middle East and Africa. "Soon we will see vicious price competition between companies who have lost exports," Green says.
In Guangdong, toymaker Luo hopes to push domestic sales up to $1.5 million this year from $1 million in 2007.
"The situation in the U.S. and other countries will not turn around quickly," he says. "We must rely more on the domestic market, as Chinese consumers increasingly have money to spend on toys. Profits are very thin in the toy business, both in export and domestic sales. I prefer exports. … Domestic sales involve more work. There are more customers. But their orders are small."
Independent economist Xie says China became overly dependent on demand from the U.S. and Europe that was stoked by too much borrowed money and inflated asset values. "It's all coming to an end," he says. "You need to look elsewhere for livelihood. Americans cannot spend money anymore."
[Via USA Today]
Tao built River Dragon from a start-up with four employees into one of China's biggest textile printing firms in just five years. He had even grander dreams: He wanted to see his company's stock trade on Nasdaq alongside the likes of Microsoft and Intel.
The dreams are dead. River Dragon shut down on Oct. 7. Tao and Yan have vanished, leaving behind more than $290 million in debt and a lot of anger in this city 140 miles south of Shanghai in the Yangtze River Delta. The company's demise put 4,000 workers on the street and jilted hundreds of suppliers and creditors.
The speedy rise — and speedier fall — of River Dragon is a depressingly familiar story in China these days. Thousands of Chinese factories have shuttered in the past year, done in by:
•An export-killing global slowdown that began with the collapse of the U.S. housing market and the ensuing financial crisis. Local textile merchant Fang Xingquan, a River Dragon creditor, is among many who believe a sharp drop-off in exports was a key factor in the company's demise.
•Rising materials costs that have squeezed profit margins.
•A deliberate Chinese government campaign to regulate sweatshop factories out of business.
China's National Bureau of Statistics this week said the nation's economy grew at an annual rate of 9% in the quarter ended Sept. 30, the lowest since 2003. The state-run Xinhua news agency said the government is considering a series of actions to boost exports and stimulate home sales.
Many economists, including Yu Yongding of the Chinese Academy of Social Sciences, believe that China needs to keep annual economic growth of 8% or 9% to absorb the 24 million people entering the labor force every year or risk social instability.
Earlier this month, the International Monetary Fund predicted that Chinese economic growth would cool from 2007's sizzling 11.9% to 9.7% this year and 9.3% in 2009. Private forecasters are even more pessimistic. UBS Investment Research, for instance, forecasts 8% growth in 2009.
"China is being hit over the head by both the global crisis and the domestic slowdown," says Stephen Green, economist at Standard Chartered Bank in Shanghai.
Exports account for nearly 38% of China's economic output. JPMorgan Chase calculates that Chinese exports fall 5.7 percentage points every time global economic growth shrinks by a percentage point. And the IMF is predicting that global growth will drop 2 percentage points — from 5% last year to 3% in 2009. Chinese appliance maker Haier has already seen export growth drop to 10% the first three quarters of this year from 30% a year earlier, the official English-language China Daily newspaper reported.
What happens to China has big implications globally: China contributed 17% of world economic growth last year, the same as the United States, according to the United Nations.
Home prices collapsing
The Chinese economy is absorbing another blow beyond crumbling exports: collapsing home prices. Nicholas Lardy, senior fellow at the Peterson Institute for International Economics in Washington, D.C., reckons a slowdown in construction could shave another 1 to 2 percentage points off China's economic growth.
"The property bubble is already starting to burst," says Yan Yu, a business management scholar at Peking University, researching the export center of Dongguan in southern Guangdong province. "House prices here in Dongguan have fallen by up to 50% this year," leaving many homeowners owing more on their mortgages than their homes are worth.
"People have worked all their lives and believed the hype and bought overvalued properties, then saw their savings vanish," says independent economist Andy Xie in Shanghai. "That carries more political risk" than rising joblessness.
The good news: The forecast growth rates are still pretty impressive by any other economy's standards; Chinese exports have proved surprisingly resilient, growing nearly 22% in September from a year earlier; and the government in Beijing is sitting on enough cash — $1.8 trillion in foreign exchange reserves — to go on a spending spree if needed to rescue the Chinese economy from catastrophe.
"Chinese authorities appear to be well aware of the global economic situation," JPMorgan Chase reported this month. The bank expects government to turn the spigot on spending, quadrupling the budget deficit to the equivalent of 2% of economic output from 0.5% this year.
The authorities aren't going to save everyone. The Chinese government has put pressure on small firms that foul the environment, pay miserly wages and turn out cheap products. "Beijing no longer wants to be the world's sweatshop for junk," CLSA Asia-Pacific Markets says in a recent report.
First, China cut tax breaks for exporters and imposed new export taxes on polluters, even targeting producers of disposable chopsticks. Then it introduced a labor law in January, requiring companies to give workers written contracts and making it harder for them to lay off employees or to hire informal part-time help.
The combination of tougher regulations, weakening exports, rising costs and a stronger Chinese currency has hammered thousands of small factories. The pain has been especially agonizing in Guangdong, a low-cost manufacturing center across the border from Hong Kong in southern China.
Guangdong's exports rose just 14% the first seven months of 2008 after growing 27% a year earlier. Industrial profits were up just 4% this year through May, compared with 49% a year earlier and puny compared with 21% growth nationwide. "Guangdong's weak performance is a signal of the government's determination to restructure the low-value-added export process sector and to force out of business firms that abuse labor and the environment," CLSA concluded.
Trouble in toyland
Firms that were already struggling with narrow profit margins have been squeezed. More than half of all China's toy exporters — 3,631 firms — shut their doors the first half of the year, the official Xinhua news agency reported. "Many toy factories have gone bankrupt this year," says Luo Yunzhang, founder of toy exporter Guangzhou Sixiren Toy, which makes playground equipment for Ohio-based Little Tikes, among other products.
"We saw exports start to dip in May, when the government began restricting businessmen's visits ahead of the (August) Olympic Games. … Now the global crisis is causing problems. When people are in difficulties, they spend less on things like toys," Luo says. Luo predicts that Sixiren's export revenue will drop by half this year, to $500,000.
China's textile industry is also enduring a deep slump. Textile exports have been tumbling since March. More than 10,000 small textile manufacturers went out of business the first half of this year alone, the government says. "The global crisis is seriously affecting the local textile industry," says Yu Xin of the China Chemical Fibers and Textile Consultancy in Hangzhou.
China's 30-year economic boom has produced towns that specialize in one product. There are shoe towns, zipper towns, air conditioner towns and sock towns. Shaoxing — a city of 4.3 million long known in China for opera, rice wine and scenic river vistas — has sold itself as China's Textile City.
The textile sector has been "an easy market, as it is not complicated, has low entry barriers and is a big employer," says Standard Chartered's Green. The local government gives tax breaks, and the industry has benefited from having a large number of suppliers and trained workers close by.
For a while, River Dragon looked like one of the winners. After working as a clerk at another firm, Tao started the company in 2003 with his wife, Yan, and four colleagues. River Dragon went public in Singapore two years ago, and Tao bought another textile firm last year, hoping the acquisition would give River Dragon the heft to list on Nasdaq. In July, Yan, the company CEO, announced that River Dragon had landed a $10 million contract to supply apparel to 76 U.S. universities. But the deal proved a mirage. The end came quickly. A day after the factory stopped production, River Dragon stock was dropped from the Singapore exchange. Corporate documents are missing, and Tao and Yan are long gone.
"I think they are still on the run in China," says Fang, the supplier. He says he was stiffed for more than $860,000 when River Dragon went under.
Keeping society 'stable'
About 300 suppliers and creditors descended on the River Dragon complex, looting warehouses in the hopes of salvaging something. Hundreds of workers demonstrated in the streets, demanding back pay for August and September. Worried about the unrest, the local government coughed up cash. "The government paid the workers to keep society stable," textile analyst Yu says.
As their export orders dry up, Chinese manufacturers are likely to look for customers at home in China or in other emerging markets such as the Middle East and Africa. "Soon we will see vicious price competition between companies who have lost exports," Green says.
In Guangdong, toymaker Luo hopes to push domestic sales up to $1.5 million this year from $1 million in 2007.
"The situation in the U.S. and other countries will not turn around quickly," he says. "We must rely more on the domestic market, as Chinese consumers increasingly have money to spend on toys. Profits are very thin in the toy business, both in export and domestic sales. I prefer exports. … Domestic sales involve more work. There are more customers. But their orders are small."
Independent economist Xie says China became overly dependent on demand from the U.S. and Europe that was stoked by too much borrowed money and inflated asset values. "It's all coming to an end," he says. "You need to look elsewhere for livelihood. Americans cannot spend money anymore."
[Via USA Today]
Sunday, October 5, 2008
How Howard Hughes Avoided Taxes
As his empire grew, Hughes used every trick conceivable to avoid paying taxes to the government. In the early years of Hughes Aircraft, Hughes attempted to move his company from Southern California to Nevada in an effort to take advantage of Nevada's low tax rates. Ultimately, Hughes donated all his stock in Hughes Aircraft to the Howard Hughes Medical Institute, thereby turning the military contractor into a tax-exempt charity. In addition to avoiding income taxes, this had the effect of silencing the upper management in Hughes Aircraft, who for many years had clamored for stock in the company as part of their compensation.
Hughes was able to keep and maintain highly qualified managers in his companies by promising them large sums of money at the end of their careers. In order to be able to give them the most money without taxation, Hughes would make an arrangement whereby he would publicly criticize a certain manager that had recently left his company. Then, the manager would sue Hughes in court for public defamation. A settlement was given to this manager in court which was not subject to taxes. This happened with Noah Dietrich, Robert Maheu, and others. For example, Robert Maheu was awarded US$2.2 million in a defamation lawsuit shortly after leaving Hughes' employ.
Although Hughes lived in his own home in California for many years, he later came up with the idea of living in hotels as this enabled him not to have a legally declared residence in any state which would require him to pay personal income taxes. Shortly after Hughes began living in hotels with no state as his official residence, legislation was passed that any person living in a state 180 days or longer was subject to personal income tax during that time period in that state. Then, Hughes would live in a given hotel for just under 180 days, before moving to another hotel for just under 180 days, and so on. His extremely creative efforts to avoid taxes were successful; even after his death, the states of California and Texas were unable to collect inheritance taxes since it could not be proven that he was a legal resident of either state.
[Via Wikipedia]
Hughes was able to keep and maintain highly qualified managers in his companies by promising them large sums of money at the end of their careers. In order to be able to give them the most money without taxation, Hughes would make an arrangement whereby he would publicly criticize a certain manager that had recently left his company. Then, the manager would sue Hughes in court for public defamation. A settlement was given to this manager in court which was not subject to taxes. This happened with Noah Dietrich, Robert Maheu, and others. For example, Robert Maheu was awarded US$2.2 million in a defamation lawsuit shortly after leaving Hughes' employ.
Although Hughes lived in his own home in California for many years, he later came up with the idea of living in hotels as this enabled him not to have a legally declared residence in any state which would require him to pay personal income taxes. Shortly after Hughes began living in hotels with no state as his official residence, legislation was passed that any person living in a state 180 days or longer was subject to personal income tax during that time period in that state. Then, Hughes would live in a given hotel for just under 180 days, before moving to another hotel for just under 180 days, and so on. His extremely creative efforts to avoid taxes were successful; even after his death, the states of California and Texas were unable to collect inheritance taxes since it could not be proven that he was a legal resident of either state.
[Via Wikipedia]
Friday, September 26, 2008
How to Replace Expensive Software Packages
If you’ve downloaded and installed all of these, you’ve got access to all the productivity software you’ll likely need, clean and open and best of all free.
1. Firefox
http://www.getfirefox.com/
Replaces Internet Explorer
If you haven’t switched to Firefox for your web browsing needs, do it now. It stops annoying popups and it has tons of amazing plugins that can make surfing the web even better.
2. Thunderbird
http://www.mozilla.org/thunderbird/
Replaces Microsoft Outlook or Eudora
Thunderbird is an email client that has five big things going for it: it’s free, it’s full featured, it’s lightweight and runs quick, it has an unparalleled spam filter, and it protects you from those ridiculous phishing attacks by clearly indicating which emails send you to a bogus website. If you’re not already using a web-based email solution, Thunderbird should be your client.
3. Sunbird
http://www.mozilla.org/projects/calendar/sunbird/
Replaces Microsoft Outlook’s calendaring functions
Might as well get the Mozilla trifecta out of the way by mentioning Sunbird, which is the Mozilla Foundation’s calendaring program. It’s extremely easy to use and easy to share your calendar with others.
4. Abiword
http://www.abisource.com/
Replaces Microsoft Word
Want a good word processor but find Microsoft Word too expensive? AbiWord is excellent replacement for Word. It’s lightweight and includes pretty much every feature that everyone uses regularly in a word processor, plus it can save files in formats that you can exchange with Word and WordPerfect users, plus open any of their files, too.
5. OpenOffice
http://www.openoffice.org/
Replaces Microsoft Excel and Microsoft PowerPoint
If you want to replace the rest of the Office suite, your best bet is OpenOffice. It includes very nice replacements for Excel and PowerPoint (and workable replacements for Access and other Office elements).
6. ClamWin
http://www.clamwin.com/
Replaces Norton AntiVirus or McAfee
ClamWin is a slick anti-virus software that’s quite easy to manage and is unobtrusive while keep your system free of viruses.
7. Gaim
http://gaim.sourceforge.net/
Replaces AIM, Windows Messenger, etc.
This is a very clean instant messaging program that allows you to be on AOL Instant Messenger, Windows (MSN) Messenger, and Yahoo Messenger simultaneously with one program. There are other free packages that do this, but Gaim is stable and clean and simple.
8. GIMPShop
http://www.gimpshop.net/
Replaces Adobe Photoshop
This is a version of the GNU Image Manipulation Program that does a pretty solid job of imitating Adobe Photoshop - a regular user of Photoshop can adapt to it quite quickly. It’s very richly featured and runs quite well.
9. VLC Media Player
http://www.videolan.org/vlc/
Replaces Windows Media Player, Quicktime, RealPlayer, etc.
If you get tired of having tons of media players on your computer, get this package that runs pretty much every media type you’ll run across without breaking a sweat.
10. Filezilla
http://filezilla.sourceforge.net/
Replaces WinFTP
Many people occasionally have a need to FTP files to other computers; if you ever have the need to transfer files in such a fashion, FileZilla will do the job slickly and quickly.
11. MusikCube
http://www.musikcube.com/
Replaces iTunes
If you’re not already committed to downloaded music from the iTunes Music Store, then MusikCube is the best choice available for a music organizer and player. It organizes your mp3s, makes it really easy and really fast to find them, and allows you to make some incredibly clever smart playlists.
12. X-Chat 2
http://www.silverex.org/
Replaces mIRC
X-Chat is a free IRC client. For those unfamiliar with IRC, it’s a place for technical people (and, as my wife loves to point out, nerds) to meet and discuss topics in an open environment. I often find it very useful when piecing through difficult technical issues.
13. PDFCreator
http://sourceforge.net/projects/pdfcreator/
Replaces Adobe Acrobat
PDFCreator creates a virtual printer on your computer that, if you print a document to it from any program, creates a PDF of that document that can be read on any computer with Acrobat Reader on it. After installing PDFCreator, all you have to do is print like normal and out comes a PDF!
14. Notepad2
http://www.flos-freeware.ch/notepad2.html
Replaces Notepad
Notepad2 is a replacement for the traditional Windows Notepad that just adds a few sweet little features: multiple documents; line, word, and character counts; and some highlighting of tags.
15. GanttPV
http://www.pureviolet.net/ganttpv/
Replaces Microsoft Project
If you do any project management, GanttPV does a brilliant job of managing the task quickly, easily, and freely. If you need to move to MS Project later, you can export from GanttPV to Project, but once you start digging into GanttPV, you’ll likely have no reason to use Project.
16. GnuCash
http://www.gnucash.org/
Replaces Microsoft Money or Quicken
GnuCash is a slimmed-down version of the bloated Microsoft Money and Quicken packages. The interfaces are incredibly simple - it functions much like a checkbook ledger on your computer - but there’s a lot of meat hidden throughout the software.
17. True Combat: Elite
http://www.truecombatelite.net/
Replaces Quake IV, Halo, etc.
After all this downloading, you’re going to need to blow off a little steam. It’s basically a third person combat game, but the graphics are spectacular and the game is quite engrossing.
1. Firefox
http://www.getfirefox.com/
Replaces Internet Explorer
If you haven’t switched to Firefox for your web browsing needs, do it now. It stops annoying popups and it has tons of amazing plugins that can make surfing the web even better.
2. Thunderbird
http://www.mozilla.org/thunderbird/
Replaces Microsoft Outlook or Eudora
Thunderbird is an email client that has five big things going for it: it’s free, it’s full featured, it’s lightweight and runs quick, it has an unparalleled spam filter, and it protects you from those ridiculous phishing attacks by clearly indicating which emails send you to a bogus website. If you’re not already using a web-based email solution, Thunderbird should be your client.
3. Sunbird
http://www.mozilla.org/projects/calendar/sunbird/
Replaces Microsoft Outlook’s calendaring functions
Might as well get the Mozilla trifecta out of the way by mentioning Sunbird, which is the Mozilla Foundation’s calendaring program. It’s extremely easy to use and easy to share your calendar with others.
4. Abiword
http://www.abisource.com/
Replaces Microsoft Word
Want a good word processor but find Microsoft Word too expensive? AbiWord is excellent replacement for Word. It’s lightweight and includes pretty much every feature that everyone uses regularly in a word processor, plus it can save files in formats that you can exchange with Word and WordPerfect users, plus open any of their files, too.
5. OpenOffice
http://www.openoffice.org/
Replaces Microsoft Excel and Microsoft PowerPoint
If you want to replace the rest of the Office suite, your best bet is OpenOffice. It includes very nice replacements for Excel and PowerPoint (and workable replacements for Access and other Office elements).
6. ClamWin
http://www.clamwin.com/
Replaces Norton AntiVirus or McAfee
ClamWin is a slick anti-virus software that’s quite easy to manage and is unobtrusive while keep your system free of viruses.
7. Gaim
http://gaim.sourceforge.net/
Replaces AIM, Windows Messenger, etc.
This is a very clean instant messaging program that allows you to be on AOL Instant Messenger, Windows (MSN) Messenger, and Yahoo Messenger simultaneously with one program. There are other free packages that do this, but Gaim is stable and clean and simple.
8. GIMPShop
http://www.gimpshop.net/
Replaces Adobe Photoshop
This is a version of the GNU Image Manipulation Program that does a pretty solid job of imitating Adobe Photoshop - a regular user of Photoshop can adapt to it quite quickly. It’s very richly featured and runs quite well.
9. VLC Media Player
http://www.videolan.org/vlc/
Replaces Windows Media Player, Quicktime, RealPlayer, etc.
If you get tired of having tons of media players on your computer, get this package that runs pretty much every media type you’ll run across without breaking a sweat.
10. Filezilla
http://filezilla.sourceforge.net/
Replaces WinFTP
Many people occasionally have a need to FTP files to other computers; if you ever have the need to transfer files in such a fashion, FileZilla will do the job slickly and quickly.
11. MusikCube
http://www.musikcube.com/
Replaces iTunes
If you’re not already committed to downloaded music from the iTunes Music Store, then MusikCube is the best choice available for a music organizer and player. It organizes your mp3s, makes it really easy and really fast to find them, and allows you to make some incredibly clever smart playlists.
12. X-Chat 2
http://www.silverex.org/
Replaces mIRC
X-Chat is a free IRC client. For those unfamiliar with IRC, it’s a place for technical people (and, as my wife loves to point out, nerds) to meet and discuss topics in an open environment. I often find it very useful when piecing through difficult technical issues.
13. PDFCreator
http://sourceforge.net/projects/pdfcreator/
Replaces Adobe Acrobat
PDFCreator creates a virtual printer on your computer that, if you print a document to it from any program, creates a PDF of that document that can be read on any computer with Acrobat Reader on it. After installing PDFCreator, all you have to do is print like normal and out comes a PDF!
14. Notepad2
http://www.flos-freeware.ch/notepad2.html
Replaces Notepad
Notepad2 is a replacement for the traditional Windows Notepad that just adds a few sweet little features: multiple documents; line, word, and character counts; and some highlighting of tags.
15. GanttPV
http://www.pureviolet.net/ganttpv/
Replaces Microsoft Project
If you do any project management, GanttPV does a brilliant job of managing the task quickly, easily, and freely. If you need to move to MS Project later, you can export from GanttPV to Project, but once you start digging into GanttPV, you’ll likely have no reason to use Project.
16. GnuCash
http://www.gnucash.org/
Replaces Microsoft Money or Quicken
GnuCash is a slimmed-down version of the bloated Microsoft Money and Quicken packages. The interfaces are incredibly simple - it functions much like a checkbook ledger on your computer - but there’s a lot of meat hidden throughout the software.
17. True Combat: Elite
http://www.truecombatelite.net/
Replaces Quake IV, Halo, etc.
After all this downloading, you’re going to need to blow off a little steam. It’s basically a third person combat game, but the graphics are spectacular and the game is quite engrossing.
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